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Credit Unions Advancing the Customer Experience for Auto Dealers

  • by David Lewellyn
  • April 19, 2022

 

By David Lewellyn, CX Director for CUDL

I recently came across this headline: Retailer Assures Customer Experience and Revenue with Visibility. The headline sums up nicely the point I want to address here: That credit unions, their auto retailer partners – and their mutual customers – all benefit when engagement is graced by intentional presence, transparent transaction, and competitive advantages.

However, customer experience – even excellent customer experience – is no more than a passive suggestion if it does not foster trust and produce growth.

A better experience defined by transparency, especially in digital events delivered within a knowledgeable and caring human touch, must make a measurable difference for the organizations involved and their mutual consumers.

The Power of Presence

It’s widely known that credit unions value partnering with local businesses to provide their members with financing at the point of sale. They know that building awareness, trust, and winning relationships with dealership staff is important and requires more than simply dropping by with updated rate sheets.

Such personal-touch marketing is core to the credit union philosophy, but it is also a significant market advantage. Credit union lenders are next door; many banks and other lenders are not and cannot consistently share local community ties or build the relationships that credit unions are known for cultivating.

Add the right technology that seamlessly integrates with this philosophy, and the resulting customer experience can be a clear differentiator for dealerships.  Credit unions using lending technology, such as CUDL’s indirect lending platform, combined with this localized presence, is exceptionally productive for dealers, credit unions, and their mutual customers.  Connecting dealers with…

Beyond the technology that helps drive a better customer experience at the dealership, new partnerships with industry influencers are helping expand dealer inventory visibility.

A unique alliance between CUDL and J.D. Power allows dealerships participating in the CUDL AutoSMART online inventory marketing program to display their inventory on the JDPower.com site. This J.D. Power site averages 1.5 million monthly visits by consumers looking for their next vehicle.

The AutoSMART program features 900-plus credit union-branded digital storefronts, connecting 14,000 dealers and 1.5 million vehicles to millions of credit union members. The program had a 37% increase in lead generation, as well as a 35% increase in lead conversion activity for dealers between year-end 2020 and year-end 2021.

The Power of Transparency

The word transparency gets bounced around these days. I like the definition Deloitte Digital uses – a belief an organization openly shares information, motives, and choices in plain language.  Deloitte notes that transparency “is an important driver in the majority of the customer behaviors we studied.”

Credit unions embrace this view of transparency. Members have a loyal alliance to their credit union because, unlike most banks, credit unions are locally based and managed—they’re an integral part of the local community—and exist solely to serve their members. Sharing a common tie with credit unions, dealers are a part of their community’s fabric, and they exist to service the car-buying and maintenance needs of their communities.

Financialbrand.com has noted that credit unions have unique opportunities to help encourage consumers to shop at local stores and that credit unions, like car dealerships, need their customers to remain loyal. Engagement at the right time will ensure that you’re meeting your customers’ needs and providing an important level of service worthy of loyalty, recommendations, and referrals.

The customer experience goal most car-shoppers desire is an online and in-store shopping investment that flows smoothly and efficiently for them – whether they start online and then move into the showroom or show up for a traditional meet-and-greet. Dealers, sales trainers, and technology providers all recognize consumers’ desire to spend less time in the car shopping experience.

Consumers benefit from transparency into the deal process when visiting vehicle inventory sites, whether through the dealership or third parties, where various apps provide tools to help them make the right deal. Apps that offer book value, invoice, pre-approval credit pulls, trade-in assessment valuations, finance and lease rates, make for a better all-around buying experience and helps build customer loyalty and repeat business.

The Power of Advantage

Market data continue to support credit unions’ ability to drive revenue for their dealership partners. According to Experian Automotive’s fourth-quarter ‘22 State of the Automotive Finance Market, credit unions were second only to banks in market share for used-vehicle lending. Credit unions are strong competitors, with 25.93% of used car lending in the fourth quarter of 2021 compared to banks’ 33.8%. Credit unions also grew new car market share from 11.2% in Q4 2020 to 13.8% in Q4 2021.  Credit unions on the CUDL lending platform funded a record $46.9 billion in auto loans in 2021, and as an aggregate, were once again the nation’s largest auto lender in 2021, experiencing 13 percent loan growth.

Credit unions’ use of digital lending and web-based inventory seamlessly integrates auto-shopping and financing, delivering a better customer experience.  Add to this their commitment to build better partnerships with dealers, and the result for customers is a more human(e) car buying experience. For dealers, this means they have an opportunity to close more deals – deals with more capacity to increase F&I product sales.  These lenders stand tall as a customer experience choice. Their engagement with auto dealers also offers the transaction speed and transparency that consumers seek.

Credit unions continue to demonstrate why they are indispensable partners with auto dealers. Credit union lending growth and marketplace presence is strong. And leveraging proven CU lending technology solutions such as CUDL’s digital indirect lending platform and AutoSmart online car-shopping platform are helping dealers capture more business and improving their level of deliverable customer excellence.

David Lewellyn is the Client Experience Director at CUDL and has 26 years of experience in the Indirect Auto Lending Industry. David has developed and advanced programs for a number of leading industry organizations, including CU Direct Connect, CRB Auto, WFS/Wells Fargo, Citi Auto, and Arcadia/Transouth.
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